Tax-simplification bill reaches House floor

The Business Activity Tax Simplification Act (HR 1439) moved to the House floor for action last week, the National Marine Manufacturers Association said.

The bipartisan bill, introduced by Reps. Bob Goodlatte, R-Va., and Bobby Scott, D-Va., would establish a bright-line rule for when states can tax out-of-state companies. The House Judiciary Committee approved the bill.

“For the past several years, NMMA has been a critical member of a broad business coalition preventing states from unfairly taxing businesses that lack a physical ‘brick and mortar’ presence through ‘economic nexus.’ Economic nexus is the idea that there is enough of a connection between the state and a potential taxpayer to justify additional taxes,” the NMMA said. “The complexity and costs of compliance to these inconsistent and vague rules hurt boat manufacturers that do business across state lines.”

Before the bill was reported out of the committee, the NMMA and nearly 200 companies and trade associations sent a letter to Rep. Lamar Smith, R-Texas, chairman of the committee, and Rep. Howard Coble, R-N.C., chairman of the Judiciary Subcommittee on Courts, Commercial and Administrative Law, urging the panel to move forward with HR 1439.

The NMMA and the companies and trade groups had endorsed HR 1439 in a May letter to Coble. In April, Joan Maxwell, of Regulator Marine, testified on behalf of the NMMA at a Judiciary Subcommittee hearing.